Colorado's irrigated agriculture is evolving as water is transferred from
farming to urban uses. In the next twenty-five years, Colorado's population
is expected to exceed 7 million people and an additional 632,000 acre-feet
of water will be needed in cities to support their needs. An estimated 300,000
irrigated acres will "dry up" as water transfers occur. Similarly,
groundwater irrigation will be reduced as new augmentation rules take effect,
as Colorado meets its interstate compact obligations, and as the Ogallala
aquifer continues its "planned depletion".

Colorado's crop production has thrived with its water resources and, in
turn, crop production has supported commercial livestock, meat packing and
dairy industries. Each of these primary agricultural industries has encouraged
economic development directly, through the purchase of inputs, and indirectly,
through the wages and salaries of employees. Given the finite nature of water
supplies, an important question is how the economic base will change as irrigated
agriculture's scope is reduced. Importantly, the impacts may be quite different
in Colorado's surface water basins because of the diversity in the basin's
economic base and heterogeneous cropping patterns.

A rigorous economic accounting will approximate the economic impacts of
reduced irrigated acres. Analysis will be focused on four basins (Arkansas,
Republican, Rio Grande, South Platte). Specific objectives include: (1) Establishing
economic demographics for each basin including population trends, housing
demographics, labor and jobs by sector, local taxes, education and agriculture.
(2) Developing a social accounting matrix (SAM) for each basin that represents
the financial interactions between the basin industries. (3) Using the four
SAM's, impact analysis will approximate the short-term economic affects of
reduced irrigated acreage.